Responsible Retrenchments in an Uncertain Economic Landscape: Lessons from the Lazada Layoffs for Employers and Employees 

Key Takeaways

• The legal and regulatory framework in Singapore concerning retrenchments 
• Specific rules around pregnant employees or directors
• Interesting Developments and Takeaways from the Singapore employment landscape: the Tripartite Model at work 
• Employer and Employee: What should you consider? 

Recent headlines in the news have cast a spotlight on the question of retrenchments, an increasingly salient issue in view of the weakening economic outlook for 2024. The recent spate of layoffs at major e-commerce player, Lazada, captured the attention of the public and authorities alike, with the National Trade Unions Congress (NTUC), its affiliate, Food, Drink and Allied Workers Union (FDAWU) and the Ministry of Manpower (MOM) intervening on the matter to facilitate an amicable resolution and fairer outcome for affected employees. Electrolux, a major Swedish home appliances maker, also announced that it would be closing its Singapore regional office and laying off employees as part of internal restructuring that will see its APAC and Middle East/Africa commercial teams relocate to Bangkok, Thailand. NTUC Secretary-General Mr Ng Chee Meng had recently forewarned that 2024 will likely see an uptrend in retrenchments, a continuation of 2023 where 13,320 workers in Singapore were let go, more than double that of 2022.

In this uncertain labour and economic market and in the wake of recent events, what rights and obligations do employers and employees alike have in relation to retrenchments? In this article, RHTLaw Asia LLP explores (1) the current legal and regulatory landscape concerning retrenchments; (2) specific rules for particular employees/individuals in a termination of employment scenario; (3) some observations of the regulatory landscape in light of the Lazada retrenchments; and (4) steps employers and employees can take to protect their interests. 

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